Monthly Review - January 2026
In brief
The markets
1.4%
-0.3%
1.3%
2.7%
0.2%
3.3%
2.9%
6.0%
4.6%
Source: Bloomberg 30.01.2026, returns in local currency
Top stories
Davos deal cools tensions
Tensions soared, as decisive geopolitical interventions by President Trump, initially in Venezuela and Iran, culminated in a bid to take over Greenland. Threats of a transatlantic trade war, with heavy tariffs on Europe, eased after a ‘forever’ deal was outlined by the president at the World Economic Forum in Davos. He claimed to have secured mineral rights on the Arctic island, while in return promising to install the US Golden Dome missile defence system to protect its inhabitants. Meanwhile, the Greenlanders themselves largely maintained that the island is neither for sale nor indeed transferable.
Gold rush as investors respond
As these geopolitical tensions mounted, traders speculated that Greenland and a number of its EU neighbours might choose to retaliate by dumping their vast holdings of US Treasuries. This put downward pressure on the price of the US government bonds, viewed as the global benchmark, and yields rose. Long-dated Japanese bond yields rose even more sharply on concerns over expansionary government spending plans, after the new prime minister called a snap general election. In the face of such uncertainty, safe haven assets received a boost. Gold topped $5,000 for the first time on unprecedented buying volumes.
AI competition intensifies
OpenAI announced that ChatGPT would in future carry advertising, in a bid to boost revenues. Meanwhile, Google explored placing product ads alongside the AI powered results from its market dominant search engine. Google’s parent, Alphabet, hit a $4 trillion valuation, on the prospects for these accelerating new revenues. Elsewhere, MiniMax, a direct competitor to China’s DeepSeek, doubled on its first day of trading in Hong Kong, where it raised funds for model development and global expansion. And Anthropic, ChatGPT’s main competitor, looks set to raise $20 billion in its latest funding round, valuing the company at $350 billion.
The West lags in green tech
Despite introducing renewable energy technology to China through a Danish wind power initiative in the 1980s, the West has lost its early lead. China is now the dominant global supplier of renewable energy technologies from solar panels to battery and rare earth supply chains. With rapid advances in infrastructure, engineering capacity and R&D spending, renewables projects can be built faster and less expensively in China. Western countries are now lagging China’s scale, strategy and competitiveness. While Europe has made some progress by fast-tracking access to EU funding and loosening regulation, US clean energy policy has been set back by the second Trump administration.
On the radar
After President Trump threatened tariff hikes on European states over Greenland and slapped additional levies on countries importing oil from Iran and Russia, it appears that Washington’s deployment of trade tariffs as a foreign policy tool might become normalised on the global stage.
The abrupt U-turn on Greenland may have eased US-EU trade war tensions, but the standoff provoked a major rift in trans-Atlantic relations, stoking fears about the future of the NATO (North Atlantic Treaty Organisation) military alliance.
Fatal shootings by ICE federal agents in Minneapolis have sparked widespread bipartisan condemnation. As Senate Democrats threaten to withhold funding for the Department of Homeland Security, the confrontation could trigger another government shutdown, perhaps sparking further market volatility.